TELSTRA GROUP LIMITED — Capital/Financing Update 2010

Oct 19, 2010

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20 October 2010

The Manager

Company Announcements Office Australian Securities Exchange 4[th] Floor, 20 Bridge Street SYDNEY NSW 2000

Office of the Company Secretary

Level 41 242 Exhibition Street MELBOURNE VIC 3000 AUSTRALIA

General Enquiries 08 8308 1721 Facsimile 03 9632 3215

ELECTRONIC LODGEMENT

Dear Sir or Madam

Telstra announces successful €500 million benchmark bond issue

I attach a copy of a media statement for release to the market.

Regards

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Carmel Mulhern

Company Secretary

Telstra Corporation Limited ACN 051 775 556 ABN 33 051 775 556

MEDIA RELEASE

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Telstra announces successful € 500 million benchmark bond issue

20 October 2010 - Telstra today announced the completion overnight of a 10.5 year benchmark €500 million Eurobond issue, with a 3.625 per cent annual coupon and a maturity of 15 March 2021.

Telstra Chief Financial Officer Mr John Stanhope said the borrowing, conducted under Telstra’s Global Debt Program, confirms the continued capacity of the Eurobond market to provide corporates with efficient and ready access to a strong and deep investor base.

“This bond issue is Telstra’s second borrowing in the Euro-market this year following a successful €1 billion issue earlier in March. The issue was priced at “Euro Mid Swaps + 95 bps” and closed within an hour of launch. The strong demand reflects both the high levels of appetite at present in the bond markets for corporate paper and Telstra's strong credit and solid reputation in the Eurobond market where it has been a regular issuer over many years.”

Mr Stanhope said the order book for the bond closed early with the issue being more than three times oversubscribed. Demand came from a wide range of over 150 high quality fixed income investors, including fund managers, insurance companies and banks.

“The bond priced at the tight end of market guidance following a global investor call and reflects the excellent work by the joint lead managers,” Mr Stanhope said.

Mr Stanhope said proceeds will be fully swapped into A$ at drawdown through to maturity and provide Telstra with around A$700 million of cost effective long-term funding. The bond will help lengthen the average maturity of Telstra's debt portfolio.

Issue proceeds will be mainly used for refinancing maturing debt and general working capital purposes.

The bond issue was jointly led by BNP Paribas, Deutsche Bank and HSBC.

Telstra has a long-term rating of A (negative outlook) by S&P, A2 (negative outlook) by Moody’s and A (negative outlook) by Fitch.

Media contact: Andrew Maiden 0458 487 754 www.telstra.com.au/abouttelstra/media-centre/ Reference: 381 / 2010

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